Financing risk in Eurasia: Community, country and region

October 10, 2018


Risk is part and parcel of development, entwined with development and inseparable from that development. Increasingly it is recognized that an understanding and management of risk is what makes development truly sustainable.

Over two days in Istanbul, UNDP hosted one of its first ever major events on the financing of risk transfers, and together with our partners in industry, the multilateral sector and governments, we worked to consider the options, tools and products that countries have to reduce and transfer risk across the Eurasia region. Key throughout was the acknowledgement that financing the management of risk is core to the future of all countries.  

The region is home to many risks. Earthquakes have been particularly devastating over recent decades, and indeed many years before that. Floods, droughts and high temperatures continue to increase in frequency and severity across the region as our climate continues to change; and as the recent report by the Intergovernmental Panel on Climate Change tells us, we have worrying times ahead for lives and livelihoods, agriculture and health, and much more.

It is these challenges, and their relationship to development, that brought 17 governments to Istanbul to discuss how their particular risks could be better managed, reduced and where required, transferred. The individuality of countries is critical here, especially considering the diversity of this region. Large countries and small, diverse economies and narrow, land-locked and Mediterranean, some that see much inward investment and others that see little. Despite the variety in specific vulnerabilities and the risks these countries face, in both cities and rural areas, it is acknowledged that all issues are critical and are to be addressed.

Central to this discussion and to the future, is an understanding of that risk. Until countries know in detail the hazards before them and can gauge their severity and frequency, they will never be well placed to make the informed decisions that are so vital. This is the first, and perhaps the most significant lesson we can take away from these two days.

Yet beyond this, countries also considered other ways in which insurance and financing can help them and their communities underpin development, from macro-economic stability to household micro-insurance, across livelihoods and health, agriculture and infrastructure, business continuity and much more.

The workshop in Istanbul has provided the opportunity for these countries to work together to consider how they will manage these risks, whether at community, country or at regional levels. All are critical. And UNDP has committed itself to working with our partner countries and our counterparts in the industry and beyond to support countries to find the right risk financing solution for them.

Risk is not periphery to development in this region, or in any other. It is central to that development. Our continually changing climate merely reminds us of the absolute urgency of action.

About the author
Jan Kellett
is a special advisor for external engagement in the Climate, Disaster and Energy team at UNDP. Follow him on Twitter: @JanKellett